What Is a Chatbot?
A chatbot is a software program that holds a conversation with a person through text or voice, answering questions and responding to requests in natural language. Chatbots range from simple rule-based scripts to systems powered by large language models.
How a chatbot works
A chatbot takes a person's message, works out what is being asked, and returns a response. Older chatbots follow fixed rules and decision trees, matching keywords to scripted replies, which makes them predictable but rigid. Modern chatbots use a language model to interpret free-form language and generate replies, so they handle a much wider range of phrasing, though they still mainly respond rather than take actions.
Chatbot vs AI agent
The difference is action. A chatbot answers within the conversation. An AI agent goes further, taking actions in other systems to complete a task, and talking only when talking is the task. A chatbot can tell a customer how to reset a password, while an agent can reset it.
At Custom AI Studio, we build AI agents rather than chatbots, because acting on a task delivers more than answering questions about it.
Related terms
Frequently asked questions.
The stuff we hear most on the first call. Don't see yours? Book a 30-minute conversation.
What is the difference between a chatbot and an AI agent?
What is the difference between a rule-based and an AI chatbot?
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